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City Talks Rates

December 11, 2012

ST. MARYS — St. Marys City Councilors Monday night got their first look at a proposed water rate increase for city customers — an increase that will help fund future utility projects.

Dennis Vossler, the 2nd Ward Councilor, walked councilors through his water/wastewater report — which detailed the need for the rate increase. Earlier this year, city officials commissioned a water rate study to determine if a rate increase was necessary to help keep the fund in such a shape as to pay for future projects and upgrades. Councilors heard the first reading of an emergency resolution approving the water rates as recommended by Safety-Service Director Eric Ostling during the meeting.

“Our water rates would still be very much in line —  in fact on the low end —  of what our neighbors are,” Vossler said. “If you look around and compare our water rates ... It’s been a long time since we’ve had a water rate increase. Basically it’s all the projects and expenses we will incur at the water department.”

The last time the city authorized a rate increase was in 1991. That rate hike took effect during three phases, the last of which was in 1995.

During last week’s water/wastewater committee meeting, Water/Wastewater Superintendent Dave Sprague unveiled the findings of a water rate study. That study recommended a 34 percent increase in rates — which is proposed to be spread out during the next two years. A 17 percent increase would take effect in March as well as in March 2014.

Councilor-at-large Ron Ginter inquired about the possibility of phasing in the rate increase during three years. Vossler told him the increase was needed during the specified time period to make sure the water fund was healthy enough to cover the costs associated with several upcoming big-ticket items.

“Our balance, our funds are running down — they’re pretty low,” Vossler said. “In order to get our money back up and healthy so we can do the projects that were recommended that we will need to do, we need to get some money back into the water fund.”

The need for an increase in water rates became clear when officials reviewed the balance in the city’s water fund. That fund, which is used to pay for utility projects, has dwindled in recent years because of a lack of revenue. The increase also is expected to help the water fund create a surplus to pay for long-term, future projects —  including a new water plant.

“Right now, we are operating in the red in the water department,” Council President Dan Hoelscher said.

“We are operating off our carryover. We still have money in our fund and are operating out of it. If we put these rates in effect at the time period this resolution states, the money flow won’t go positive until 2015. That’s why we are doing it in the phases we are.”

Using 2010 rates, a city customer that used 1,037 cubic feet of water a year paid $308.

That figure would increase to $373 during the first phase of the rate increase and then increase to $437 in the final phase.

During the committee meeting, Sprague calculated a city customer with the same usage would now pay $318. Celina customers paid $691 for the same amount of water, while Wapakoneta residents paid $419 in 2010.

Delphos customers paid $920, while Van Wert residents paid $501 for the same amount of water.

St. Marys Mayor Pat McGowan said the city put off relining the interior of a water tower because of the water fund’s crippling finances.

A well head issue also could put the city’s ability to provide an adequate water supply in jeopardy.

“If we have a catastrophic failure out here, right now, we would be in real trouble,” McGowan said.

“So we need to build those funds back up as quickly as possible.”

The resolution merely gives council’s support of the proposal. Under Ohio law, Ostling has the authority to set water rates as he deems necessary without council’s approval. However in the past, councilors have approved a similar measure as a show of support.

In other business, councilors:

• Witnessed McGowan give the oath of office to Samuel Rammel and Dane Dwenger as the newest members of the St. Marys Fire Department.

• Approved the second reading of two ordinances amending sections of the codified ordinances related to the city’s vicious dog ordinance and its code enforcement officer.

• Approved the first reading of an emergency ordinance authorizing the 2013 budget.

• Approved the first reading of an emergency ordinance authorizing the purchase of various materials for city departments.

• Approved the first reading of an emergency resolution authorizing the mayor to enter into a Housing Revolving Loan Fund Administrative Agreement for certain CDBG programs with the Ohio Development Service Agency.

• Approved the first reading of an emergency resolution authorizing Ostling to enter into a contract with RJ Corman for improvements to the crossing along East Spring Street.

• Approved, under suspension of rules, of an emergency resolution authorizing the execution of an easement for construction of a gas main. Dominion plans to run a high-pressured natural gas line to Veyance.

• Rescheduled the second meeting in December to 6 p.m. Dec. 27.

• Set electric/communications and finance committee meetings for 6 p.m. and 6:15 p.m. respectively.

Councilors entered executive session to discuss possible real estate acquisition. No action was taken when they reconvened in regular session.

The next meeting of the St. Marys City Council is scheduled for 6 p.m. Dec. 27 at the city building located along East Spring Street.

 

 

 


 

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